Finally Getting the Picture

The "politics as usual" scorn aimed at Sacramento this week, emphasized by a downgrade of California's investment quality, appears to be moving the boulder of partisan stubbornness. Legislators and Gov. Arnold Schwarzenegger returned to bargaining Wednesday. They were reportedly closing in on a possible compromise to put a $15-billion bond to finance the state's debt on the March 2 ballot, along with new limits on future spending.

Republicans in the Legislature were balking Wednesday night at occupying a middle ground, in a mirror image of what Democratic leaders did to former Gov. Gray Davis. The obstructionist mantle doesn't look good on either side, and GOP leaders will surely see how bad the refusal to compromise appears to voters.

On Friday, a compromise was almost in view when both sides just up and quit. They can't afford to be seen failing again, either in the calculations of investors or the minds of voters.

Without an agreement, local government faces severe, immediate cuts in state aid because of Schwarzenegger's rollback of the car tax increase the day he took office. The first victims would be police and fire departments and public health. Schwarzenegger inexplicably washed his hands of their plight Tuesday. "It's not me taking anything away from them," he said, it's the Legislature. Perhaps one of his advisors recognized how bad that sounded and helped push Schwarzenegger back to the table.

The governor was right during his campaign in saying people don't care about political details. They just want him and the rest of the state's elected officials to deliver. Message to the Legislature: Get the bond and spending-limit issues solved or face the wrath of voters who see state government as merely stealing local money.

Some Democrats -- most notably Senate President Pro Tem John Burton -- have been as inflexible about keeping their spending power as some Republicans in the Legislature and on Schwarzenegger's campaign staff have been about a strict spending cap. This time around, Schwarzenegger talked directly and effectively with Democratic leaders and will have to persuade his own party to accept the result.

The deal reportedly calls for a balanced budget and enables midyear spending cuts. That is far from the governor's initial draconian spending cap proposal but close to a bipartisan plan that was defeated Friday.

The bond and the spending limit are just one step. They do nothing about a projected shortfall of an additional $10 billion or more in next year's budget. But a success on these issues would persuade investors that California's political system is not completely broken. It would save the state a divisive, costly 11-month political campaign, which is what would happen if talks failed.

Across the capital, the gravity of what comes next is apparent. The state's elected leaders have been deaf to their failure, but their hearing seems to be returning.

If the recall campaign did one positive thing, it focused California's attention on state government. Now there's a new opportunity for reforms that would enable state and local governments to deal effectively with a rapidly changing state.